Page Nine

Friday, March 30, 2012

I am a bankruptcy attorney in Phoenix, Arizona ($995/Chapter 7) and frequently clients ask me if they can include their businesses in a basic Chapter 7 personal bankruptcy. The other option is filing Chapter 11 bankruptcy for their business, which is much more complex and usually costs at least $5000. Generally, if your businesses don't have any money in them or are essentially defunct, you can fit them into a Chapter 7 bankruptcy. It is when you have multiple employees and intend to keep the business going that you might need to file Chapter 11 for businesses. Chapter 7 requires you to only have $150 in one banking account when you file, no more than that, and if you have businesses with more money than that in them it will be difficult to get one checking account down to that level. Also, you can only have a limited amount of cash on hand when you file, so you can't just take out the money and hide it. If you have your own petsitting business, a couple of LLCs you've formed but done nothing with them, or a business that you are shutting down, you can file Chapter 7 and absolve any debts attributed to them.